The lure of fixing a bad credit score can be especially attractive when you start shopping for financing. If you have a low credit score, you will immediately find out that improving your score can save you a great deal of money. If you try to hire a credit repair company to help, you need to consider a few things first.
Credit Repair Services
Instead of working on fixing your credit on your own, you may be tempted to work with a credit repair service. These companies promise to be able to help you increase your credit score. You will have to pay the company a fixed fee for the credit repair and then they will go to work to make the necessary changes. Some credit repair services promise to be able to remove negative statements from your credit report, while others promise a certain amount of improvement in your credit score.
Scams
One of the problems with this industry is that many companies are not legitimate. If you mistakenly choose one of these companies, you could be out of a lot of money. These companies may take your money on the front end of the transaction and then not perform the services that they claimed. When this happens, you lose your money and your credit score is still low. While the Federal Trade Commission works to identify these companies and help eliminate them, new companies spring up constantly.
Spotting a Scam
When you are in the market for a credit repair service, you need to use some discretion before choosing a company. One of the signs that you should look for is a large upfront fee. If the company charges a large fee upfront, you should be very skeptical because they could easily keep it without providing any service. You should also look for information about the company on the Better Business Bureau website. This will tell you if the company has many complaints against it.
Rapid Rescore
If you are in the market for a mortgage or an auto loan, you might be able to access a rapid rescoring company. These are companies that can be accessed through the help of a lender. These companies have relationships with the credit bureaus and can quickly fix anything that is wrong with your credit report. These companies can make the necessary changes to your report and get your score changed within 72 hours as long as you are willing to cooperate with them.
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